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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
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FOREIGN OWNERSHIP OF LAND BILL

Second Reading

Adjourned debate on second reading.

(Continued from 18 July 2012.)

The Hon. R.P. WORTLEY (17:06): This bill relates to a land ownership and registration issue that requires a nationally consistent approach and an issue that is not a land-use planning issue. The bill does not refer to a land-use planning issue.

Foreign ownership of land in Australia is regulated by the Foreign Investment Review Board, which was established under the commonwealth Foreign Acquisitions and Takeovers Act 1975. As members may be aware, the powers for the commonwealth to legislate on such matters spring from section 51(xx) of the Constitution, which relates to foreign corporations. Matters covered in section 51 can be legislated on by states, but such legislation may be held invalid if it is inconsistent with, or if it is matter intended to be fully covered by, commonwealth legislation.

The bill mirrors the Queensland Foreign Ownership of Land Register Act 1988, which requires foreign landowners to be included on a register but is limited in that it is only intended to apply to farming land. While this bill deals with an important issue—one that some in the community feel government needs to regulate—such reform must, in the government's view, be undertaken on a national basis.

The establishment of a register maintained by the Registrar-General has obvious and significant resource implications which would need to be addressed and which may duplicate the existing register established under the Foreign Investment Review Board. The best and most appropriate means of achieving this is through the COAG process, possibly by increasing the role and reach of the Foreign Investment Review Board. That issue is one on which the government believes significant work would be required to ensure that legislative control and review of foreign investment is fair and equitable and does not unduly limit investment that would be beneficial to Australia.

Establishing different systems in each state will not achieve a system where the community can easily access information on foreign investment in Australia. This is a significant policy decision that requires a national approach if it is to deliver its objectives. For these reasons, the government opposes the bill.

The Hon. D.W. RIDGWAY (Leader of the Opposition) (17:09): I speak on behalf of the opposition on the Foreign Ownership of Land Bill 2012. The state Liberal Party supports the Foreign Ownership of Land Bill 2012, which calls for a statewide register of foreign-owned farmlands. The bill simply seeks to provide some transparency for developing a foreign ownership of farmland database that is accessible and available to the public. Members would be aware that there is often quite a lot of coverage in the media when foreign entities buy South Australian or Australian land. The Foreign Ownership of Land Bill 2012 is a way to protect South Australia's sovereign interests, with the supporting argument that all South Australians would like to see water, land and food security being better protected in our state.

Currently there are foreign investment rules that require an investment in a state-owned enterprise to obtain approval by the Foreign Investment Review Board. However, no such requirement is needed for a state-owned enterprise or a sovereign wealth fund. That is, as long as a single investment in agriculture is less than $244 million, there is no requirement for any approval by any investment board or any such equivalent. This bill will require foreign owners and foreign entities which acquire agricultural land in South Australia to complete notification of ownership with the register not later than 90 days after the date of acquisition. The penalties for noncompliance range from $2,500 to $75,000 for a person who contravenes the provisions of the bill.

I note that for the last 24 years Queensland has had in force the Foreign Ownership of Land Register Act 1988. The current bill is very similar to the Queensland equivalent; however, the South Australian bill will require non-residential commercial industrial land that is outside of townships and the metropolitan area to be registered. Essentially, the bill provides access to foreign ownership of agricultural farmland data which is not currently available from the lands title office.

I would like to make it clear that the Liberal Party acknowledges a great benefit of foreign investment in South Australia, both culturally and economically. I can recall from my days of farming in the South-East, and well before that, that a number of tracts of land were developed just north of where our property was, and that was done with foreign investment. The local economy benefited; there were jobs; there were young men (jackaroos) who had come to play footy, to join a youth club, and so there was a whole range of benefits.

In recent times, after I had reached adulthood, a German company bought a large area of cropping land in and around Wolseley and invested in some quite good infrastructure, sheds for storing fertiliser and grain, new houses—I think two new houses, but definitely one new house. Then, after about a 10-year period and a couple of crook seasons, they decided that it did not fit their investment profile any more and sold it, so it is now owned by Australian farming families who took an opportunity to acquire it after the foreign ownership had ceased.

I suspect that we will see, with foreign ownership of land, some churn when overseas investors see an opportunity and then their circumstances change, or we have a run of bad seasons. When things are looking good in a farming enterprise, the grass is always greener over the fence. I suspect what we will see over time is this evolutionary thing. We had big investment from English, American and European interests over the last century. Now we see it from China and the Middle East and other parts of the world, and I expect that we will continue to see that churn. However, the Liberal Party does support having a transparent way of knowing exactly what is going on.

I do not believe that there is really any greater percentage of land owned by foreign ownership today than there has been in the past. It may be different ownership, but it is important that we do keep an eye on what is happening in our community. The Liberal Party is very happy to support this bill.

The Hon. A. BRESSINGTON (17:13): I also rise to support the Hon. Robert Brokenshire's Foreign Ownership of Land Bill. This bill requires disclosure of present interests in land; disclosure of legal acquisitions of interest in land; notification of disposal of interest by a person who is listed as owner, trustee of the interest; foreign owners are required to submit a notice of ownership no later than 90 days post acquisition; persons are required to notify of changes ceasing to be a foreign person or becoming a foreign person; registering of all foreign ownership; access to be granted to register by application and payment of fee; and the registrar can require further information to ascertain liability of a person to lodge a prescribed form or to comply with the act. The registrar can require a person to give information or to attend before the registrar or authorised person, and the registrar may enter information they consider appropriate on the register. It creates an offence of not complying with requirements to produce information or attend with the registrar.

That is only some of the things this bill seeks to achieve. I have to say that I am very much aware of the level of angst in the community amongst people who are not inclined to be politically motivated about the amount of land, or the perception that there is more land, in the hands of foreign ownership now than ever before. In fact, some of the figures that the Hon. Robert Brokenshire gave in his second reading speech were quite disturbing, but we do not know whether this is any more or any less than has occurred in the past.

I do not see the harm in the openness and transparency of a local register. I remember a few months ago I went to a dinner at which Senator Barnaby Joyce was in attendance. I had a discussion with him at half time and asked what the federal National and Liberal parties are going to do about foreign ownership. He said to me, 'Well, you know, it's sort of a bit like this: the Chinese have got more guns than we've got, and they've got bigger guns than we've got, and if we are going to kick their arse'—excuse the language—'they're going to kick ours 10 times harder.' That is a very concerning statement for a senator to make, given that this was an evening where he was addressing food producers. For him to say that we are fast becoming a foreign-owned country is very disturbing.

I know that people in South Australia want to know who owns the land but also what investment opportunity is being made in this state. There is a difference between foreign investment and foreign ownership. The Hon. Robert Brokenshire made the point that the Chinese were actually sending wool home to China to be processed in China rather than doing it here and us selling the end product. We have to see that, in the long-term, our manufacturing, our agriculture—everything—is being turned over to foreign powers. We are leaving ourselves with very little room to move to build a productive and expanding economy.

We have to come to terms with the fact that you cannot just expand an economy by imposing more and more taxes and not increasing productivity at the same time. This is a sensible bill by the Hon. Robert Brokenshire. I know that it would be supported in the community by the majority of people, if only to put their mind at ease and to show that the government is prepared to be open and transparent about the amount of land in the hands of foreign countries.

The Hon. T.A. FRANKS (17:18): The Greens also support the bill before us. It should come as little surprise to the mover, because in fact the Greens have moved for similar things at a federal level, working indeed with Senator Xenophon from our state. Currently we have a bill in the Senate, along with Senator Xenophon, to introduce a stricter legislated national interest test for the Foreign Investment Review Board's review of sales of agricultural land, and we are pursuing that issue.

In fact, the report from the Senate Regional and Rural Affairs and Transport Legislation Committee's inquiry into an examination of the Foreign Investment Review Board National Interest Test was indeed due to report today. I am not sure if it has been granted an extension, but certainly we will await the results of that quite eagerly.

With regard to that inquiry, we have actually heard witnesses provide evidence. One particular representative of a food company of the Qatari government said that its strategy was, as a small oil-producing nation, to buy up land around the world because they recognise that food will be the oil of this century, and that is the reality. The geopolitics of the world in the 20th century was based on oil; the geopolitics of the 21st century will be based on land and water for food production. That is coming straight from the mouths of those who are pursuing that policy.

Indeed, 2012 was the Year of the Farmer in Australia—an important year in a global context because it was an opportunity to reflect on the role of food policy and to get it right. I hope that in this state, while we talk about a clean and green food bowl being part of our principles and platforms for the future prosperity of this stage, we really do need to get it right.

There are two major issues globally; that is, we now have seven billion people on this planet, going into nine billion people mid-century. How are we going to sustainably feed, clothe and house those nine billion people in a way that is fair and sustainable, both ecologically and socially? That is, indeed, one of the great challenges we face as legislators.

There are reducing planetary limits of availability for food production and, of course, in regard to water and our marine environments as well. We know that countries such as China, Qatar, South Korea and the Arab states are recognising that they cannot produce enough food for their own people. They recognise that world trade is not going to be able to provide food security—accessible, affordable food—for their people, and there will indeed be other countries probably pursuing this in the future.

As we see more extreme weather events and climate change really kick in, it will not just be poor countries. Currently, as we heard from Professor Pinstrup-Andersen from Denmark, who came here for an agricultural conference in 2011, developing nations, Africa and Asia, have been leasing land to foreign governments and companies, often in secretive deals, and kicking small farmers off the land in those countries because there is no form of land title. The foreign investors then go in and develop that land and export the food back to their home countries, doing nothing to improve the food security of those nations.

It is not just those nations that are vulnerable; indeed, Australia is also vulnerable. In case you believe that that is a fear campaign, in an assessment last year a report for the government revealed that in Western Australia, for example, one-third of the water licences were already partially or wholly foreign owned and that a large part of the Northern Territory was in that same category.

While there have been some words here of 'She'll be right,' I think this is certainly something that the honourable member and Family First are to be commended for in bringing this to the parliament. Certainly, the Greens are pushing for this at a federal level, so it is no surprise that we will be supporting this bill today.

The Hon. J.A. DARLEY (17:22): I would like to say that South Australia has been a leader in automated land information systems since the late sixties, and South Australia currently has the most comprehensive land information system not only in Australia but in the world. I believe that the sorts of changes that would be needed to accommodate this current bill are relatively minor and I therefore support the bill.

The Hon. R.L. BROKENSHIRE (17:22): I thank all honourable members for their contribution, and I want to say a few things in summing up. It is interesting that when you look at the submissions that were put to the commonwealth inquiry—which the Hon. Tammy Franks indicated the Greens had initiated as part of legislation federally—a submission was made by the Land Services Group of the South Australian government, through the Department of Planning, Transport and Infrastructure. That submission stated in one paragraph:

I confirm that South Australia does not maintain a foreign ownership of land register. The Foreign Ownership of Land Bill 2012 is however currently before our parliament. It provides for a register administered by the Registrar-General very similar to that existing in Queensland.

It goes on, but I will not read the whole letter. However, I find it interesting, and it also confirms what the Hon. John Darley said about the database, whether it was a Torrens title system or the current database. We proudly stand as South Australians before the world, leading in all that land title information and associated technology. I cannot understand why the state Labor government is opposed to this because, if you go out there where people actually vote, I suggest that the majority of South Australians support some transparency when it comes to a register on which foreign ownership can be very easily identified—as the Hon. John Darley and other colleagues have said in their contributions—so that we actually know what is happening.

People want to know what is happening, and that is really all this bill is about. It mirrors the bill in Queensland, which was obviously put forward earlier on because Queensland was the initial target for foreign investment. It is not that we are opposed to all forms of foreign investment. As the Hon. David Ridgway, the leader of the Liberal opposition said, they support foreign investment but with some caveats, and one of those is that people be allowed to know what is happening with foreign ownership of our land so that a proper debate can occur.

I finish by saying that when I have FOI'd the LTO in the past, unfortunately, even though the Hon. John Darley has indicated that the sophisticated database would be easily amended, at this point in time they do not have that as individual information we could access. So, that is the reason for putting the bill forward.

I commend the absolute majority of the house for supporting me, and I look forward to the government waking up with some common sense to this bill as it, hopefully, proceeds to the lower house because, if a national register does get up, then whoever is in government at the time in each state will have to have to record this information anyway.

Bill read a second time.

Committee Stage

Bill taken through committee without amendment.

Third Reading

The Hon. R.L. BROKENSHIRE (17:28): I move:

That this bill be now read a third time.

Bill read a third time and passed.

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